328) U.S.-China Relations: 21st Century Compact? - Minxin Pei

U.S.-China Relations: 21st Century Compact?
Minxin Pei, Mathieu Duchâtel
Thursday, January 14, 2010 – Paris

Resources
• Event Audio
• Event Transcript

In the middle of November 2009, President Obama visited Japan, China, Singapore, and South Korea. This tour reflected the increasing significance of the region for U.S. foreign policy. In China, President Obama met with Chinese President Hu Jintao, and the two leaders exchanged views on a variety of issues, ranging from climate change, trade, nuclear weapons, and human rights to U.S. debt.
In an event co-hosted by Carnegie Europe and the Asia Centre (Science Po), Carnegie’s Minxin Pei discussed the complexities of the U.S.–China relationship and the prospects for future collaboration on issues of common national interest. The discussion was moderated by the Asia Centre’s Mathieu Duchâtel.
History of U.S.-China Relations
At the end of the Cold War, China was cooperative and accommodating to the United States, acceding to Washington’s demands on many important issues. However, Pei explained, a major determinant of China’s behavior is its assessment of the balance of power. That assessment has changed over the past decades:
• China’s Growing Assertiveness: Chinese leaders have seen American power enter into a period of rapid and, they believe, irreversible decline. In stark contrast, China has experienced a period of rapid growth in both economic power and international influence, as well as an enormous increase in its own self-confidence.

• Early 2009: Pei observed that in the initial stages of the Obama presidency, the relationship between the United States and China went through an uncharacteristic period of calm.

• China’s Change in Attitude: Today, Pei explained, Chinese leaders now believe they can be tougher on the United States. This has been made clear on multiple issues and occasions, including President Obama’s visit to China, the Copenhagen conference, on currency policy, on human rights issues, and, most importantly for the United States, in China’s position on sanctions on Iran.
The Future of U.S.-China Relations
China needs the United States more than the United States needs China, Pei stated, but he warned that China’s dependence on the United States is decreasing. China is actively developing ties with other countries, such as important members of the EU, Russia, and many developing nations. Moreover, Pei explained, there is a growing list of areas in which Washington is increasingly dependent on help from Beijing. Chinese leaders are acutely aware that they can now drive a harder bargain with the United States.
The underlying power dynamics of the U.S.-China relationship are changing, and possibly becoming more equitable. Both sides will have to adjust to this change. China will have to learn not to become too pushy with its new-found strength, and avoid acting in ways that will harm its long-term national interests. The United States, on the other hand, will need to learn to be more humble and accommodating in its dealings with China. One thing the United States must do in order to maintain leverage with China is invest in Asia, both economically and politically. The United States will need to strengthen its ties with Japan as well as with South-East Asian countries.
Potential Areas of Conflict
Pei expanded on three issues that could potentially cause conflict between the United States and China:
• Oil: China and the United States both cooperate and compete in oil. Both countries have an interest in seeing oil prices come down, because they both consume huge amounts of it, but they also compete for limited oil resources.

• Regional Relationships: China has expressed displeasure with how the United States is using India to try to contain China. While China is not strong enough to retaliate directly against the United States, it can retaliate against India. In general, handling third parties in the region will be a potential source of conflict, as both China and the United States are vying for the support of major players such as Pakistan and Japan.

• Green Energy: Pei explained that China will not accept any international mandatory caps. China believes that green energy is a legitimate economic opportunity and is therefore increasing investment in it. However, it is doubtful that China’s investment in green energy will offset the rapid increase in greenhouse gasses produced by its continued reliance on coal.
China as a Superpower
Due to its status as the world’s largest exporter, and its immense reserves of foreign currency, China is undoubtedly close to being a superpower in economic terms. However, Pei asserted, China is not yet a superpower in the same sense that the United States is.
There are two key components to being a modern superpower, according to Pei. First, a superpower has to represent something; it has to have an ideological appeal. Second, a superpower must have a secure and stable political system. To the outside world, China looks very strong. However, the adoption of draconian measures, such as internet and press censorship, reveals the Chinese Communist Party’s fears of losing its grip on power. China also faces enormous ethnic problems, such as in Sinkiang or Tibet. As a result, Pei explained, its internal political cohesion is relatively weak. When a country is internally politically weak, he continued, it cannot project power abroad.
Ultimately, Pei concluded, China’s status as an economic superpower is often overvalued, while its weaknesses are overlooked.

Minxin Pei is Senior Associate and Director of the China Program at the Carnegie Endowment for International Peace.